Price of rebar drops from $1,500 a tonne to $500 as building boom slows
Demand for reinforced steel in the Gulf is expected to nosedive by one-third next year.
Qatar Steel, which is wholly owned by the emirate's government, said the drop would be caused by falling demand and plummeting oil prices.
Ali Hassan al-Muraikhi, the manager of the firm's commercial division, told a conference in Dubai that rebar had fallen from around $1,500 a tonne in July to just $500 now.
The mills in this region have to consider cutting production
Ali Hassan al-Muraikhi, Qatar Steel
He said that the infrastructure and building boom, particularly in Dubai, had begun to tail off which was causing the drop in price. He added: “The mills in this region have to consider cutting production.” The firm's own mill complex is based at Mesaieed Industral City, south of the capital Doha.
Muraikhi said prices of rebar would edge up next year but not to the amounts seen this summer. He added that there was a strong correlation between oil and steel prices as revenue from the energy sector had helped finance the construction boom across the UAE.
Oil prices have slipped below $50 a barrel from a peak of $147 back in July.